7 Low-Debt Basic Materials Stocks With Robust Profits

Profitability is perhaps the biggest determinant in whether or not a company is a good investment. While there are many other factors to consider beyond profits, it tends to reveal the most about a company's standing, fiscal management, operational efficiency as well its outlook. With this in mind we ran a screen of basic materials stocks to find companies with strong earning trends over the past year and have the additional attribute of minimal debt. By keeping debt manageable, these companies have not compromised their capital structure and can continue to focus on expansion. Look below to learn more about these profitable basic materials stocks that are not laden with debt.

The Long Term Debt/Equity Ratio is a variation of the traditional debt-to-equity ratio; this value computes the proportion of a company's long-term debt compared to its available capital. By using this ratio, investors can identify the amount of leverage utilized by a specific company and compare it to others to help analyze the company's risk exposure. Generally, companies that finance a greater portion of their capital via debt are considered riskier than those with lower leverage ratios.

The Debt/Equity Ratio illustrates how aggressively a company is financing its growth via debt. The more debt financing that is used in a capital structure, the more volatile earnings can become due to the additional interest expense. Should a company's potentially enhanced earnings fail to exceed the cost associated with debt financing over time, this can lead the company toward substantial trouble.

EPS growth (earnings per share growth) illustrates the growth of earnings per share over time. EPS growth rates help investors identify stocks that are increasing or decreasing in profitability. This profitability metric is generally a key driver in the price of the stock as it directly correlates to the profitability of the company as a whole.

The Net Margin is a profitability metric that illustrates, by percentage, how much of every dollar earned gets turned into a bottom line profit. This is just one of many profitability metrics used by investors and analysts to better understand what the company is being left with at the end of the day. Generally, a firm that can expand its net profit margins over a period of time will see its stock price rise as well due to the trend of increasing profitability. Net Margin = Net Income/Total Revenue

We first looked for basic materials stocks. We then looked for businesses that have maintained a sound long term capital structure (Long Term D/E Ratio<.1). We then looked for businesses that operate with little to no debt (D/E Ratio<.1). We then screened for businesses that have strong profitability (1-year fiscal EPS Growth Rate>10%)(Net Margin [TTM]>10%). We did not screen out any market caps.

Do you think these stocks deserve to trade higher? Use our screened list as a starting point for your own analysis.

Harmony Gold Mining Company Limited engages in the exploration, processing, and smelting of gold in South Africa and Papua New Guinea. The company has 10 underground operations; and various surface operations, including an open cast mine and 9 processing plants, which are located in goldfields in the Witwatersrand basin of South Africa, as well as the Kraaipan Greenstone Belt. It also explores for silver, copper, and molybdenum through its Papua New Guinea projects. Harmony Gold Mining Company Limited was founded in 1950 and is based in Randfontein, South Africa.

Imperial Oil Limited engages in the exploration, production, and sale of crude oil and natural gas in Canada. The company operates through three segments: Upstream, Downstream, and Chemical. The company was founded in 1880 and is headquartered in Calgary, Canada. Imperial Oil Limited is a subsidiary of Exxon Mobil Corporation.

Apco Oil and Gas International Inc. operates as an oil and gas exploration and production company in South America. The company has producing operations in the Neuqun, Austral, and Northwest basins in Argentina; and exploration activities in Argentina and Colombia. As of March 31, 2012, it had interests in nine oil and gas producing concessions and two exploration permits in Argentina, as well as three exploration and production contracts in Colombia. The company was formerly known as Apco Argentina Inc. and changed its name to Apco Oil and Gas International Inc. in July 2009. The company was founded in 1970 and is headquartered in Tulsa, Oklahoma. Apco Oil and Gas International Inc. is a subsidiary of WPX Energy, Inc.

Oceaneering International, Inc., together with its subsidiaries, provides engineered services and products primarily to the offshore oil and gas industry with a focus on deepwater applications worldwide. Its Remotely Operated Vehicles segment provides submersible vehicles operated from the surface to support offshore oil and gas exploration, production, and construction activities. The company was founded in 1965 and is headquartered in Houston, Texas.

National Oilwell Varco, Inc. designs, constructs, manufactures, and sells systems, components, and products for oil and gas drilling and production, as well as provides oilfield services and supplies, and supply chain integration services to the upstream oil and gas industry worldwide. The company was founded in 1862 and is headquartered in Houston, Texas.

Helmerich & Payne, Inc. engages in the contract drilling of oil and gas wells. It provides drilling rigs, equipments, personnel, and camps on a contract basis to explore for and develop oil and gas from onshore areas and fixed platforms, tension-leg platforms, and spars in offshore areas. The company conducts land drilling operations primarily in Oklahoma, California, Texas, Wyoming, Colorado, Louisiana, Mississippi, Pennsylvania, Utah, Arkansas, New Mexico, Alabama, Montana, North Dakota, and West Virginia; offshore drilling operations in the Gulf of Mexico, offshore of California, Trinidad, and Equatorial Guinea; and international land drilling operations in Ecuador, Colombia, Argentina, Mexico, Tunisia, and Bahrain. The company was founded in 1920 and is headquartered in Tulsa, Oklahoma.

7)Titanium Metals Corporation (TIE)

Sector

Basic Materials

Industry

Industrial Metals & Minerals

Market Cap

$2.35B

Beta

1.57

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Key Metrics

Long Term Debt/Equity Ratio

0.08

Debt/Equity Ratio

0.08

Earnings Per Share Growth Rate

43.09%

Net Margin

10.55%

Short Interest

6.34%

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Titanium Metals Corporation produces and sells titanium melted and mill products. It provides titanium sponge, which is the basic form of titanium metal used in titanium products; melted products, such as ingots, electrodes, and slabs that are the result of melting titanium sponge and titanium scrap; mill products, which are forged and rolled from ingot or slab, including billets, bars, plates, sheets, strips, and pipes; and fabrications, such as spools, pipe fittings, manifolds, and vessels, as well as offers titanium scrap and titanium tetrachloride.

The company serves commercial aerospace and military sectors; and desalination, chemical, oil and gas, consumer, sporting goods, healthcare, automotive, and power generation industries. Titanium Metals Corporation distributes its products through its sales force in the United States and Europe; and through independent agents and distributors internationally. The company was founded in 1950 and is headquartered in Dallas, Texas.

*Company profiles were sourced from Google Finance and Yahoo Finance. Financial data was sourced from Finviz on 09/21/2012.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Business relationship disclosure: This article was prepared for ZetaKap Media by one of our full-time analysts. We did not receive compensation for this article (other than from Seeking Alpha), and we have no business relationship with any company whose stock is mentioned in this article.